The energy-economic growth relationship: a new insight from the eroi perspective

Florian Fizaine has presented his paper called “the energy-economic growth relationship: a new insight from the eroi perspective” at the LEO seminar (Laboratoire d’Economie d’Orléans) held on 22 march.
He has also presented “Energy expenditures, economic growth and the minimum EROI for society” during the environmental and resource economics lunch seminar held at Paris Panthéon Sorbonne on 31 march.
These communications are from the same paper that is evolving. Here is a abstract:
Abstract
In this article we estimate the level of energy expenditures from 1850 to 2012 for the United States of America (US) and the global economy. Periods of very high energy expenditures as fractions of GDP (for example from 1850 to 1945), or of sharp increases (for example from 1973 to 1974, and 1978-1979) are associated with low economic growth rates. On the contrary, periods of low or sharply decreasing energy expenditures are associated with high and increasing economic growth rates; for instance from 1945 to 1973. On the more restricted 1960-2010 time period on which we have continuous year-to-year data for control variables, namely population, unemployment rate and capital formation, we are able to estimate that in order to have a positive growth rate, the US economy cannot afford to allocate more than 10.6% of its GDP to energy expenditures. In other words this means that considering the current energy intensity of the US economy, a minimum EROImin of approximately 11:1 (that conversely corresponds to a maximum tolerable average price of energy 2 times higher than current level) is needed in order for the US economy to present a positive growth rate. Furthermore, we performed several Granger causality tests that consistently show a temporal one way causality running from the level of energy expenditures (as a share of GDP) to economic growth. Our study supports the idea that a coherent economic policy should first of all be based on an energy policy consisting in improving the net energy efficiency of the economy. Doing so would lead to a “double dividend”: an increase of the EROI (through a decrease of the energy intensity of capital investment), and a decrease of the sensitivity of the economy to energy price volatility.